Artisan Partners, an investment management company, released its “Artisan Mid Cap Fund” fourth quarter 2024 investor letter. A copy of the letter can be downloaded here. In the fourth quarter, the fund’s Investor Class fund ARTMX returned 5.11%, Advisor Class fund APDMX posted a return of 5.14%, and Institutional Class fund APHMX returned 5.14%, compared to an 8.14% return for the Russell Midcap Growth Index. US equities achieved solid Q4 gains, concluding a strong year. Following Donald Trump’s election win, optimism surged over deregulation and tax cuts. However, concerns about inflation from proposed tariffs and immigration policies emerged in December, introducing market volatility. Despite this, markets ended 2024 with strong gains, marking one of the best two-year performance stretches in decades. In addition, please check the fund’s top five holdings to know its best picks in 2024.

In its fourth quarter 2024 investor letter, Artisan Mid Cap Fund emphasized stocks such as Onto Innovation Inc. (NYSE:ONTO). Onto Innovation Inc. (NYSE:ONTO) designs, develops, manufactures, and supports process control tools that perform optical metrology and inspection. The one-month return of Onto Innovation Inc. (NYSE:ONTO) was -35.43%, and its shares lost 28.84% of their value over the last 52 weeks. On March 4, 2025, Onto Innovation Inc. (NYSE:ONTO) stock closed at $135.41 per share with a market capitalization of $6.672 billion.

Artisan Mid Cap Fund stated the following regarding Onto Innovation Inc. (NYSE:ONTO) in its Q4 2024 investor letter:

"Along with Monolithic Power Systems, notable adds in the quarter included Onto Innovation Inc. (NYSE:ONTO) and Gitlab. Onto Innovation provides process control solutions and inspection systems needed for advanced semiconductor packaging inspection and optical metrology. Wafer-level packaging inspection is a small yet rapidly growing segment within process control tied to increasing chip sales from AI, edge computing and wearable technology advancements. Optical metrology growth is driven by a transition to 3D chip architecture, which requires greater numbers of sensitive layers to be measured and tracked. This growth is further supported by gross margin and operating margin expansion, as increasing complexity drives pricing power. Shares declined in the quarter due to cyclical pressures that we believe are largely short-term issues. We used it as an opportunity to build our position."

A technician observing a macro defect inspection process, the precision of the company's systems.

Onto Innovation Inc. (NYSE:ONTO) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 50 hedge fund portfolios held Onto Innovation Inc. (NYSE:ONTO) at the end of the fourth quarter which was 34 in the previous quarter. While we acknowledge the potential of Onto Innovation Inc. (NYSE:ONTO) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

In another article, we discussed Onto Innovation Inc. (NYSE:ONTO) and shared the list of best mid-cap growth stocks to buy according to analysts. Artisan Mid Cap Fund increased its position in Onto Innovation Inc. (NYSE:ONTO) in the previous quarter. In addition, please check out our hedge fund investor letters Q4 2024 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.